PG&E cancels competitive dark fiber business plan

Four days after informing the California Public Utilities Commission that it couldn’t reach agreement with a grab bag of protesting organisations, Pacific Gas and Electric threw in the towel. It’s ending its plan to become a competitive telecommunications company. It won’t put its extensive inventory of surplus dark fiber, and potentially other services, on the open market.

Given PG&E’s present circumstances, it is in the public interest that PG&E make current informed decisions in light of the new environment before investing significant resources in launching the new [competitive telecoms] business. PG&E and parties have diligently engaged in settlement negotiations to expeditiously make progress towards full resolution of the issues in this proceeding. However, as more time passes, the uncertainties of PG&E’s current circumstances outweigh the potential economic and busines benefit of the proposed [competitive telecoms] business. Therefore, the public interest is protected by allowing PG&E to exercise its prudent business decision-making to not continue to pursue the [competitive telecoms] business, at this time, given the significant change in circumstances since the filing of the…Application in April of 2017.

PG&E didn’t say exactly which circumstances had changed, but top of the list has to be the estimated $12 billion in damages it might have to pay out as a result of last year’s wildfires. When a company faces an existential financial threat, it’s time to scrap diversification plans and focus on the core business.

When California’s utility regulator lines up – wittingly or not – on the same side as big, monopoly model telecoms companies like AT&T, Comcast and Charter Communications, it’s game over. Retreat was PG&E’s only option.